Comedian Jeff Dunham says people who buy new cars for their kids have it all wrong. 16 or 17 year old kids, he emphasizes, don?t need a new car – they need a bumper car. And he was talking about his own daughter! I totally agree! A kid does not need a new car! It’s mostly a want, either by the kid, or even the parent.
The closest thing to a legitimate sounding opinion I?ve heard for buying a brand new car for a kid is for safety, that new cars incorporate the latest and best safety features and it?s worth paying the extra money for better survivability in the event of a crash.
Maybe. But maybe not. I?m not convinced that the newness of a car has as much to do with safety as the make of a car. Think Volvo here – historically one of the safest cars available irrespective of age. I?m also equally certain that when human beings are feeling the itch to spend money, nearly any decent sounding justification can and will be used to support the decision, reason and logic be damned.
Five reasons why your kid does not need a new car
What are some compelling reasons for not buying a brand new car for your kid? Here are five:
1. Cost. OK, I admit that I didn?t even have to think about this one – but we should never overlook the obvious. Unless you?re searching for ways to spend money, this is absolutely one of the very best ways to waste a whole bunch. Cars, after all, cost a lot of money, and not all of it in the purchase price.
A new car will require greater outlays for insurance, ad valorem taxes (if you have them in your state), as well as maintenance and repairs. After all, you can?t put less expensive used parts in a new car, nor can you use a friend or backyard mechanic to maintain or repair it.
A good quality used car will save you money on all of these recurring expenses, in addition to the price of the car.
2. Humility. Most of us consider humility to be a valuable personal characteristic in a person, especially in our own children. But how is that quality imparted in a kid who?s about to get a brand new car?
A brand new car is virtually a counter teaching on humility. If it?s a trait we?re trying to instill in our kids, this is close to the worst way to make it happen. It would be difficult indeed for a teenager to not get a big head when showing up to his high school parking lot with a brand new car.
3. Future rewards and merit. A new car is one of life?s financial rewards. They?re something we buy for ourselves as a way of compensating ourselves for hard work, accomplishment and thrift. What has your high school child accomplished that warrants such a bonus? By giving them a new car, you?re separating rewards from merit.
Maybe this is old fashioned, but I think kids shouldn?t have a new car until they?re in a position to contribute to it financially, and in a major way.
4. Personal responsibility. This might be an expansion of future rewards and merit, but by giving a kid something for nothing, no lesson of personal responsibility is being conveyed by the parents. It?s one of the best examples of something-for-nothing – a message no teenager needs to learn, especially from their? parents.
In my experience (I have teenagers myself), I think most people tend to overrate their kids? levels of maturity and responsibility. A car is one of the best – and last – opportunities you will have to teach them this lesson before they head out into the world.
5.Damage control. Now let?s get back to that bumper car thing! Jeff Dunham may have made this suggestion in jest (watch his Jeff Dunham?s Very Special Christmas DVD, it?s a real hoot!) but it?s really a serious point.
Kids WILL get into fender benders – many without rational or cohesive explanation – it?s part of the whole learning to drive experience. Do you remember what it was like when you first learned to drive? It?s part of the whole teenage thing! Would you rather that happen in a $30,000 new car, or a $3,000 ?beater?? And which do you think will cost less to fix???
Let kids cut their teeth on a beater, then let them have the joy of trading up as they gain more experience, responsibility and financial capabilities. Not only will you save a ton of money, but you?ll also be giving your teenager a chance to learn the satisfaction of personal accomplishment as she moves through life.
Can you think of other reasons why buying a new car for a kid isn?t a good idea? Or am I all wet on this subject?
( Photo by qwrrty )
Kevin, I really enjoyed this post. It reminds me of all the kids I saw in my high school with new cards at the age of 16. Some were luxury cars! I was so envious at the time, but am grateful my mom and dad bought me an old used Honda Civic. It had character and unfortunately I smashed the front end after rear ending some lady while watching the cheerleaders after school. 🙂 I don’t think there is any reason to buy a child a brand new car. Love your point about humility.
Jason – You’re experience of rear ending that lady while watching a cheerleader sounds like that car insurance commercial with the guy decribing himself as that good looking girl you were watching when you drove into that tree (forget which company, but they get what can make us not pay attention).
I’m thinking about this situation right now because my son is 16. Not so much because he’ll be getting a new car (he won’t) but because we’ve noticed the stunning number of kids his age who do get them. It seems like a colossal waste of time, and maybe more of that one upmanship that seems to prevail these days.
My 21 yr old son is on his 4th car. Thankfully we only bought one that was fairly new. It was to last him through college…not…he totalled it (we made $1000 on the deal – yea!). Now he is driving a 2001 Civic with no AC in hot, humid Houston! Ha!Ha! Live and learn!
Danna – I think you’re teaching him a valuable lesson letting him get by with older cars. I thijnk that teaches them to take care of what they have. Until they learn that, there’s zero point in buying them anything new.
I totally agree. Not once have my parents bought me anything without me having to pay them back. Including vehicles. So when my first truck got to expensive, I sold it Paid off my parents and bought a smaller truck with better gas mileage with what i had left.
Cody – The discipline that they imposed is benefitting you. That’s one of the biggest overlooked “costs” of buying a new car for a kid–the fact that he/she won’t develop a sense of responsibility as a result. In wanting our kids to succeed we can often overlook the more crucial ability to survive. That only comes from some self denial.
Great article Kevin, it totally brought back memories of my rear-ending someone in my first used car and being glad I didn’t have a brand new one. I remember one classmate in high school who had to work to purchase her used car and pay for the insurance herself. I remember thinking her parents were tough! But now, I can see she was probably more careful in her decisions with her car as a result. I think I may do something similar with my children so they will be able to learn the value and responsibility of owning and driving a vehicle.
NWJ – That rear end experience of yours seems to be close to universal! Kids are going to have accidents, regrettably that’s part of how they learn to be more careful. We just have to hope and pray that they’re the fender bender variety and not something more serious. I agree, making they pay for the car themselves is a better way to introduce responsibility. Paying their own way, combined with a used car puts kids on the right path.
Safety is the only thing I care about regarding my teen’s car. I don’t care if it looks like a tuna can on wheels, if it safe, then all is good.
We will help our son, but it will not be new. It will have air bags though, that is one thing I require.
ET – Thats a great point about air bags. We shouldn’t sacrifice safety for our kids in the name of economy. That’s good advice for anyone shopping for a car for their kids.
I’ve always liked the concept that Dave Ramsey talks about. They save up and then the parents double it. So, they save 3k, the parents chip in 3k and the kid buys up to a 6k car. Just gotta keep an eye on that savings account, so they don’t hit you with a 15k bill when they save every penny for 10 years.
Beating Broke – That’s a superb guideline, the parent match. Maybe you could add an upper limit to it, say $5,000 as your maximum match. For all the reasons listed in the post, you still don’t want your teenager buying something that’s too high cost.
Car insurance is really expensive. I know a person whose son got into accident less than 1 month of getting his license. Well… their insurance went up an extra $2000 per year and now they are paying more than $4000 per year. Isn’t it crazy? I don’t think I can never pay that much.
USM–We have the same situation with my son, who is now 17. Our insurance is about to go up about $1200 in order to add him to ours–and he has no accidents! My daughter will start next year. They going to both have to help pay some of it, there’s no other answer.
Because it snows in my area, both my sister and I were in accidents by slipping off of the road when we were 16 and 17, why waste a new car when you know it’s going to get in an accident of some sort.
Too expensive to go that route, I’m buying used for my son!
Hi Don–We’re doing the same for my son. He’s going for his license this week and it will most certainly be a used car. He can cut his teeth on that, save up some money, and when the time is right he can go for something newer.
We don’t have much snow in these parts, but there are all kinds of factors that could lead to an accident. Somehow I think that an older car that has less power might discourage some, shall we say, youthful exhuberance behind the wheel.
I don’t think kids need a car at all but that is because I grew up in Europe and everything was walkable, or had good public transportation.
I wouldn’t want my kid in a clunker, unless it was my own old car and I knew exactly how safe everything was, but would go for a used car since they are likely to wreck it.
Hi Pauline–That’s my thinking too. It’s often thought that if the parents have the money, why not? But I think there are reason that go beyond money as to why you shouldn’t do it even if you can afford it.
What a great article Kevin, no 16 year old needs a new car even if I had the money to buy it for them I still wouldn’t do it. My first car was a Delta 88 and it wasn’t nothing special. It had 4 wheels, and a motor and only cost me $400. In fact I was even able to sell it get my $400 back to buy my next car.
YES Chris, that was close to my situation as well. We bought and sold used cars for $800, $1000, $1200, and when they broke beyond repair, or we messed them up, we sold them for scrap then bought another. Sometimes you could buy one for $1000, drive it for a year or two, then sell it for $800. Not a bad deal!
I think we learned something doing that, something kids getting new cars don’t. You learn that you will make mistakes, that you make do with what you have, and you also develop a bit of a horse traders skills. Not a bad set of skills for any kids to learn.
It pains as well as puzzles me when I drive by a high school (In a wealthy part of town) and see Beemers, Mercedes and other late model luxury cars in the “Students’ parking lot. I can only believe that the parents of those students spend so little time with their kids that getting them expensive or new cars is a way to ease their conscious. Jeff Dunham was absolutely right about saying they need bumper cars. Every one of your teens has had an accident (from minor to totaled) in their first car!
Hi Jose–I live in area like that – kids drive BMWs, Mercedes, monster pick-up trucks, while the faculty lot is filled with ten year old subcompacts! I don’t know how a teacher teaches in that enviroment, because on the surface it appears that the kids are already better off then they are. And I agree that buying a new car for a kid is often how parents compensate for other deficiencies.
You have to wonder what’s going through those teachers heads when they work with the “spoiled” kids everyday. Especially when you consider that teachers are severely underpaid,
Hi Jose–I think it’s probably very similar to a $1 million/year coach trying to direct a $10 million/year athlete.
As the father of three, ages 24, 22, and 19 I don’t have time to relay all of kid car stories via our family. For example we have an ’01 Accord that I bought used for me and has gone through two in high school and is now driven by one of those two at college. We had a ’94 Volvo sedan, which after several years of teen use (after 100K + miles as my car) we finally donated to charity as I helped the driver push it onto the flatbed.
Great post.
Hi Roger–Thanks! It sounds like you’ve lived what I’ve written in the post! I’m guessing your kids are better off for it.
This may be an extension of cost or damage control but another reason we don’t need to buy kids a new car is that a new car loses something like 70% of its value in the first four years. (Don’t know if the statistic is completely accurate but it’s something crazy like that.) Better to buy them a used car and save/invest the rest of our money for college. That’s going to be benefit them a whole lot more.
Hi Brian–If you can invest the difference, that would be a huge advantage. I doubt most people would, but there’s no doubt that your teenager would probably save at least some money as a result of having a less expensive car.
When our son was a teenager he drove my car until I got a new one. Then my old car became his car. It wasn’t terribly old but it was far from new. For some reason, which I forget, when he was in his second year of college he and his father went out and bought him a brand new $26,000 Subaru Impreza WRX. I about freaked. I thought they were going to get a little newer model used car and they come home with the most expensive car in the family. We paid for it until he got out of college and he did take over the payments himself. At least he kept it for about ten years post graduation so it did turn out to be a good car for him. I agree, a kid doesn’t need a new car….even though our actions were contrary to my belief.
Hi Kathy – I’m guessing that the fact that your son started out with second hand cars helped in develop the responsibility that enabled him to handle the new car in an adult manner. And the fact that he got 10 years out of it – at a critical time in his life – was a serious benefit for your whole family. And if he was in his second year of college when he got it, he was likely around 19 or 20, which is more of a young adult than a teen. It all worked out well.
These are some great points. I especially like your point number 5: Damage Control. It does cost a lot to fix a vehicle after it’s been in an accident, but it’s cheaper to fixed a used car. I work at Overland Park Mazda and we do offer new and used vehicles for great prices. I would have to agree that getting a used car for a teenager is the best action to take.
Hi Mike – The advantage with a used car is that you can fix it with used parts, and that cost a fraction of what it will for new parts on a newer car. You can say “let insurance pay for the repair”, but one or two of those and your premiums will be through the roof. If you can fix a car for a few hundred dollars, and don’t need to file a claim, you’ll save a fortune on insurance premiums. Fender benders are bound to happen with teenagers.
Kevin, you have a very good point. There are clever ways to save money on cars and their parts, if only we spend our money wisely. One thing I didn’t mention in my last comment was that I agree with your post that it teaches teenagers humility to not have a brand new car when they start driving. What a great way to teach them this personal characteristic.
Hi Mike – When I wrote this post, I was actually thinking that humility is the single biggest reason for not buying your kid a new car. The last thing the world needs is another teenager who has an exaggerated self-image as a result of having a few too many toys thrown his way over his short lifetime.
The corollary to this is that a used car teaches a kid to make do with scare resources. Unless your wealthy, and fully prepared to bankroll your children for the rest of their lives, one of the most basic survival skills is learning to properly allocate limited resources. The sooner they learn that skill, the better. Buying them a brand new car is a reverse example of that skill.
Perhaps our most basic responsibility as parents is to teach our kids how to survive as adults. It’s hard to make a case as to how buying them a new car fits in with that strategy.
I didn’t by my two daughter a beater. With my first daughter, I went online and I bought her a four year old mustang with about 74,000 miles as a high school sophomore. For every dollar she saved for the downpayment, I match it in the showroom when we bought it. Then she had to finance the car for 5 years at $150.00 a month. She worked part-time throughout high school. When she graduated from high school, I took up the payments as a high school graduation gift. She drove the car for 11 years well into her marriage. For my 2nd daughter, my wife bought a new car and we let her take up the remaining four years of payments of $375 a month. (This car also had about 70,000 miles on it) Both were nice cars! She was also a sophomore in high school. When she graduated from high school, i did the same thing and made the remaining payments. She also worked part time all throughout high school. Today, they are both responsible with money and they often share this with their young children.